Ask Kidder

Is a cash balance plan right for me?

If you’re looking for a significant tax shelter – plus a way to reward yourself and, perhaps, your key employees – a cash balance plan may, indeed, be right for you.

Cash balance plans are often ideal for high-income business owners and key employees, since they provide both the opportunity to generate large tax deductions and an effective way to dramatically grow retirement savings. Annual pre-tax contributions can be well into six figures for the targeted owner/key employee group. And since they’re employer contributions, FICA tax savings are also possible.

Kidder is one of America’s largest and most experienced providers of cash balance plans. Our in-house actuarial team and pension consultants will work closely with you and your advisors to develop a personalized cash balance plan that can help:

  • quickly grow your retirement savings;
  • achieve meaningful tax deductions;
  • better manage employee costs;
  • reduce concerns about interest rate volatility; and
  • assure fiduciary compliance.

Cash balance plans are usually developed in combination with a 401(k) plan. Under certain circumstances, the tax savings from this combination can actually fund the employee costs for both plans.

Typical cash balance clients include professionals, medical and dental practices and highly profitable, closely held businesses.